Novato’s downtown feels churn of business changes, rising rents

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Copperfield’s Books will open this week on the first floor of the Umpqua Bank building in downtown Novato. (Robert Tong/Marin Independent Journal)

A lease sign hangs Friday on a building at Grant Avenue and Seventh Street in Novato. Commercial rents are on the rise in central Novato, as elsewhere in the county. (Robert Tong/Marin Independent Journal)

After three decades operating his family’s 62-year-old coin shop in San Francisco, owner Charles Jonath in December moved Alex and Son Coins to the heart of his family’s hometown — downtown Novato.

In the four months since then, Jonath has seen quite a few shops come and go. But with a loyal following, the third-generation business is faring just fine at the new site, he said.

“We’re the only coin shop in Novato, so I’m not sure if that gives us an advantage,” Jonath said. “Time will tell with that. The majority of our business is legacy customers, so I think we’ll survive regardless of what downtown Novato does.”

The downtown is always changing, but — perhaps fueled by rising commercial rents — change seems to have accelerated in the past year with numerous businesses coming and going, business owners say.

“I’m a little nervous,” said Andy Podshadley, president of the Downtown Novato Business Association and owner of Trek Winery, on Machin Avenue. “There’s a transition happening on Grant Avenue right now.”

In past months, the Citibank branch on Grant Avenue shut its doors, along with Super Fresh Gallery and Cooper’s Public Market. In January, Marin Trophies moved to Bel Marin Keys.

As the revolving door hits Novato’s central business district, the city is pinning its hopes of renewed downtown vitality on the opening of a few establishments.

“It’s a good time for Novato,” said Councilman Eric Lucan. “A lot of stuff is being breathed into the downtown, which is really the heart of Novato.”

New life in Old Town

The community will celebrate the ribbon-cutting Wednesday of Copperfield’s Books on Grant Avenue; its doors officially open Thursday. Renovation of the long-shuttered Novato Theater is also expected to begin soon. And with the support of downtown business owners, the Novato council approved a Sonoma-Marin Area Rail Transit station downtown. Partial construction of the station will begin soon.

“We’re trying to create more entertainment and restaurants downtown so businesses can feed off of those,” said Chris Stewart, the city’s economic development manager.

“Super shopping centers” such as Vintage Oaks make it necessary for cities to reinvent their downtowns, Stewart said. Novato has been doing that for years, he said.

Theaters are often successful in attracting foot traffic, which is why the city recently tried luring Cinemark theater, across from Vintage Oaks, to the downtown, Stewart said. Theater management considered moving the movie house to Grant Avenue, near Redwood Boulevard, and then near Trader Joe’s, but eventually decided against it, Stewart said.

Although the downtown’s vacancy rate is a low 3 percent, Podshadley said he is concerned about the rapid coming and going of businesses.

He fears rising rents are to blame.

“Real estate in general has gone up, and is going up,” Podshadley said.

John Williams, managing director of SVN Commercial Real Estate in Novato, said that as the economy has improved, downtown rental rates have increased 10 to 15 percent, and now range from about $1.75 to $2.50 a square foot.

But the increase is similar to the rise in rental rates throughout the county, he said.

‘Pretty standard’

Williams, who has been done business in the downtown for 25 years, said he’s not alarmed by what he sees.

“There are a lot of really long-term businesses down there,” Williams said. “I’m visualizing as going up Grant Avenue, from where Whole Foods is, and that happens to be an anchor there. And there are maybe two vacancies on the east side (of downtown) and two or three on the west side. It’s pretty standard.”

Williams said he thinks Copperfield’s Books will be great for the area.

Robert Eyler, chief economist for the Marin Economic Forum, said rents are rising no more quickly in downtown Novato than they are throughout the region. The rise in rents is likely to continue over the next 12 to 18 months, he said. That could be affecting business owners considering closing their doors.

Eyler said the shopping of Novato residents come into play.

“Novatans are more Costco people, not boutique people,” he said. “The data is plain that Target and Costco are big players. Downtown doesn’t have that anchor to draw wallets.”

But Lucan said that with the new projects underway in the downtown, there’s excitement in the air.